Despite COVID-19: 3U on course for success with a strong first quarter of 2020

- Group revenues rise by 21.8 %, EBITDA increases by 40.9 %

- All three segments report growth; telecommunications also stronger; logistics optimisation in the SHAC segment is being continued

- Debts further reduced, equity ratio 58.4 %

- Forecast for the 2020 financial year confirmed

 

Marburg, 13 May 2020 - In the first quarter of 2020, 3U HOLDING AG (ISIN DE0005167902) has strongly increased its consolidated revenues. At EUR 15.99 million, it came in 21.8 % higher than in the same quarter of the previous year (Q1 2019: EUR 13.12 million). Above-average growth was recorded by the Cloud Computing business area, which increased by 56.2 %, but the e-commerce business area also grew by 16.0 % from a significantly higher starting level. Even the Telecommunications business area was able to expand its business again for the first time in the first quarter. Favourable weather conditions and the first-time inclusion of the newly acquired Roge wind farm led to a noticeable increase in revenue in the Renewable Energies segment. Wind and solar energy also made a pleasing contribution to the Group's EBITDA. Earnings before interest, taxes, depreciation, and amortisation rose disproportionately by 40.9 % to EUR 2.90 million (Q1 2019: EUR 2.06 million). Consolidated net income rose by 75.2% to EUR 0.86 million (Q1 2019: EUR 0.49 million).

Segment results

The ITC (information and telecommunications technology) segment recorded a 26.4 % increase in sales from EUR 3.44 million to EUR 4.35 million in the first quarter of 2020, the first quarter of a year-on-year increase for several periods. In the course of the measures against the COVID-19 pandemic, especially due to the spread of work from the home office and measures to restrict contact, demand for telecommunication services rose significantly in the second half of the quarter. Following the declines of the previous quarters, this also led to revenue growth in the Voice Retail segment from EUR 0.55 million to EUR 0.57 million. However, the 14.7 % growth in the Telecommunications business area overall is also attributable to the already expected increase in revenues from value-added services. The cloud computing business at the subsidiary weclapp grew by 56.2 % compared with the first quarter of 2019. Its EBITDA margin rose from around 24.8 % to around 32.5 % due to lower staff growth. In view of the difficult economic situation associated with the measures to combat the COVID 19 pandemic, changes in the group of existing and potential customers could possibly have an adverse effect on the cloud computing business. The ITC segment's EBITDA improved by 52.1 % to EUR 1.16 million in the first quarter of fiscal year 2020 (Q1 2019: EUR 0.76 million). Also thanks to the low depreciation and amortization in this business area, the segment result increased by 35.1 % to EUR 0.75 million (Q1 2019: EUR 0.55 million).

The Renewable Energies segment achieved with EUR 3.49 million the highest quarterly sales in the last fiscal years. Compared to the first quarter of 2019 (Q1 2019: EUR 2.41 million), sales increased by 44.4 %. The Roge wind farm, acquired at the turn of the year, contributed EUR 0.84 million to this increase. However, even without this acquisition, the very good wind yield combined with high solar irradiation would have increased segment revenues by 9.4 % to EUR 2.64 million compared to the already good first quarter of 2019. Segment EBITDA rose by 43.4 % to EUR 2.86 million compared to EUR 1.99 million in the first three months of 2019. After depreciation and amortization on the wind projects and interest expenses for the loans used there declined relative to revenues, segment earnings reached EUR 1.32 million, an increase of 64.1 % (Q1 2019: EUR 0.80 million).

Sales in the SHAC segment (sanitary, heating and air conditioning technology) were 13.3 % higher at EUR 8.25 million (Q1 2019: EUR 7.29 million). The strategically important e-commerce business of the subsidiary Selfio grew disproportionately in this segment by 16.0 %. Higher cost of materials following the loss of a supplier and increased selling expenses in the wake of the measures taken against the COVID 19 pandemic led to a decline in EBITDA. In the SHAC segment as a whole, the cost of materials ratio also rose to 79.1 % (Q1 2019: 76.8 %). The further implementation of the own brand strategy will help to improve this ratio again in the future. The segment EBITDA was additionally burdened by expenses in connection with the optimisation and expansion of logistics capacities in the run-up to the construction of the new distribution centre and was negative at EUR -0.36 million (Q1 2019: EUR 0.03 million). The segment result declined to EUR -0.46 million (Q1 2019: EUR -0.05 million).

Increase of cash position and shareholders' equity

The cash inflow from operating activities developed favourably and reached EUR 1.73 million (Q1 2019: cash inflow of EUR 1.68 million). As the cash outflows from investing and financing activities were significantly lower than in the first quarter of 2019, a clearly positive addition to financial resources of EUR 1.08 million was generated (Q1 2019: EUR 0.09 million). Accordingly, cash and cash equivalents increased to EUR 18.54 million (31 December 2019: EUR 17.46 million). Free cash flow reached EUR 1.48 million in the first three months of fiscal year 2020 (Q1 2019: EUR 1.20 million).

Total assets increased to EUR 84.34 million as of 31 March 2020 (31 December 2019: EUR 80.48 million). The balance sheet extension is mainly due to the business-related increase in current assets. Inventories rose to EUR 8.03 million (31 December 2019: EUR 7.80 million), while trade receivables increased to EUR 4.90 million (31 December 2019: EUR 3.91 million). Non-current assets for the first time include the Roge wind farm, which was acquired at the turn of the year.

The key financial ratios were again improved as of 31 March 2020. Scheduled repayments led to a decline in non-current and current financial liabilities to EUR 17.34 million (31 December 2019: EUR 17.72 million). The gearing ratio declined from 73.0 % to 71.3 %. Net cash (cash and cash equivalents minus financial liabilities) rose to EUR 4.29 million (31 December 2019: EUR 2.83 million). Equity reached EUR 49.23 million (31 December 2019: EUR 46.51 million) thanks to the pleasing consolidated net income and the positive result carried forward. Despite the balance sheet extension, the equity ratio therefore increased to 58.4 % (31 December 2019: 57.8 %).

Forecast for the 2020 financial year confirmed

Following the good first quarter, the Management Board is reiterating its forecast and expects a strong increase in sales. In 2020, revenues of between EUR 58.0 million and EUR 63.0 million are expected. Income from the sale of assets has also been included in the planning. EBITDA of between EUR 10.0 million and EUR 12.0 million is expected. Based on current planning, consolidated earnings will be between EUR 2.0 million and EUR 3.0 million due to higher depreciation and amortisation and higher tax expenses. At present, it is not possible to predict whether and to what extent the economic restrictions will remain in place throughout the year and whether this could necessitate corrections to the forecast in the course of the year.

"The restrictions imposed to combat the COVID 19 pandemic are exposing the economy in Germany, Europe and worldwide to considerable distortions. We took the necessary measures to protect all employees in the 3U Group at an early stage. Our business models are helping to overcome the crisis - like telecommunications and online trading - or are not affected by it - like power generation from renewable energies. We are very pleased that our strategically most important business units, Cloud Computing and Online Trading, performed well in the first quarter as planned. However, we do not underestimate the risks resulting from the COVID 19 pandemic. Furthermore, we expect the digitalisation of business processes to intensify worldwide once the pandemic has abated and are ideally positioned for this with our Cloud Computing division", emphasises Michael Schmidt, Speaker of the Management Board of 3U HOLDING AG. "Especially now it is becoming clear that the diversification with our three segments is able to contribute significantly to the stability of the 3U Group as a whole. Beyond the current economic situation, we therefore see ourselves well positioned at all levels to continue our course of profitable growth.

Quarterly announcement

The quarterly report for the first quarter of the 2020 financial year will be published today, 13 May 2020. It can be downloaded from the company's website (www.3U.net) under "Investor Relations/ Reports". Under "Investor Relations/Annual General Meeting", the draft speech manuscript of Michael Schmidt, Spokesman of the Management Board of 3U HOLDING AG, for the virtual Annual General Meeting on 20 May 2020 may also be found there.

Further information:
Dr Joachim Fleïng
Investor Relations
3U HOLDING AG
Tel.: +49 (0) 6421 999-1200
Fax: +49 (0) 6421 999-1222
E-mail: [email protected]

About 3U:
3U HOLDING AG (www.3U.net) 3U HOLDING AG (www.3U.net) has its headquarters in Marburg, Germany, and was founded in 1997. It is the operating management and investment holding company at the head of the 3U Group. It acquires, operates and sells companies in the three segments of ITC (Information and Telecommunications Technology), Renewable Energies and SHAC (Sanitary, Heating and Air Conditioning Technology). The 3U Group has successful and profitable business models based on megatrends in all three segments. It continues to expand its business activities dynamically, particularly in its strongest growth areas of cloud computing and online trading, in which it is striving to achieve leading positions in the market.
3U HOLDING AG's shares are traded on XETRA, Tradegate and on the German regional stock exchanges (ISIN: DE0005167902; identifier: UUU).

Contact:
Dr. Joachim Fleing
Head of Investor Relations

3U HOLDING AG
Frauenbergstraße 31-33
D-35039 Marburg
Tel.: + 49 (0)6421 999-1200
Fax: + 49 (0)6421 999-1222
Email: [email protected]
www.3u.net